Livinglies's Weblog

For most people, the concept of indorsing a note and delivering an “original” of the note to the indorsee/endorsee can only mean one thing — the note is evidence of the debt and thus, by virtue of the merger doctrine, the transfer of the note means that the note was essentially “title” to the debt. Hence the debt is owned by the transferee. The banks took advantage of this assumption and conducted millions of foreclosures based upon this assumption despite all facts to the contrary. Even if you talk to lawyers or judges their minds cloud over with the argument. It isn’t credible because it isn’t possible — the very definition of the word counter-intuitive.

Breaking through this bias is fundamental to successfully defending foreclosure actions. In every case I know about or was involved as lead counsel, the winning defense was firmly rooted in the knowledge that the debt was never transferred despite a mountain of fabricated documents that say otherwise.

Remember that if the debt WAS transferred, the transferee of the note would have a clear path to asserting the status of HOLDER IN DUE COURSE, which by law defeats virtually any defense that the homeowner might have. That is by operation of law, adopted by all states in the Uniform Commercial Code. The clear path would consist of easy proof: here is the note, here is our proof of payment, we are a holder in due course entitled to enforce both the note and the mortgage.

The plain fact is that nobody is asserting HDC status. And that can only mean that they didn’t pay for the debt. And that means they don’t own the debt. And that means they cannot, under any circumstances, foreclose on the mortgage without showing definitive proof that they are acting as agent for a disclosed creditor.

I added this to yesterday’s post but I think it should be published on its own. 

Let us help you plan for trial and draft your foreclosure defense strategy, discovery requests and defense narrative: 202-838-6345. Ask for a Consult.

I provide advice and consent to many people and lawyers so they can spot the key required elements of a scam — in and out of court. If you have a deal you want skimmed for red flags order the Consult and fill out the REGISTRATION FORM. A few hundred dollars well spent is worth a lifetime of financial ruin.

PLEASE FILL OUT AND SUBMIT OUR FREE REGISTRATION FORM WITHOUT ANY OBLIGATION. OUR PRIVACY POLICY IS THAT WE DON’T USE THE FORM EXCEPT TO SPEAK WITH YOU OR PERFORM WORK FOR YOU. THE INFORMATION ON THE FORMS ARE NOT SOLD NOR LICENSED IN ANY MANNER, SHAPE OR FORM. NO EXCEPTIONS.

Get a Consult and TERA (Title & Encumbrances Analysis and & Report) 202-838-6345 or 954-451-1230. The TERA replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).

THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

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see Legal Aid Federal Practice Manual on STANDING

Published by the Sargent Shriver National Center on Poverty Rights

Here is an analogy that might help this counterintuitive process.

Assume I own a car. I enter into an agreement with my friend Jane to sell the car to her. I sign the title and give it to her. Afterwards we both decide we didn’t want to do that. Jane pays nothing for the car. Jane does not get the car. Jane never uses the car. I still have and use the car and both Jane and I disregard the fact that I gave her a signed title. She does nothing with the title. Later in a loan application she lists the car as an asset. Then the car is stolen from me.

Who gets the insurance proceeds? The question is whether the title represents an actual agreement to buy the car. And all courts that would boil down to whether or not Jane paid me. She didn’t. I get the insurance proceeds because I lawfully applied for a duplicate title and received it.

But Jane still has one copy of the title signed by me in original form. She has also made copies of it that can be printed out with the appearance of an original. So far, she has sold the car 42 times and taken out 7 loans on the car.

One of the people that received the title records it with the DMV. There is a problem with that. I still have title and possession of the car. The gullible person who “bought” the car has a title signed by Jane, who has produced evidence that she received title from me. One of Jane’s lenders on car stops receiving payments from Jane’s Ponzi scheme.

They “repo” the car and I go to court. Jane is a witness not a party and only if I can find her. The lender to Jane has no legal title even though they have what looks like an original title that is facially valid. Do I get my car back or does the lender” get to keep it? The title to the car is not a negotiable instrument, so they have no legal presumptions to show that their claim is valid.

One step further: if jane’s lender was actually a co-conspirator who accepted the false title and never gave a loan, does that change anything? I ask because this is exactly what is happening in nearly all foreclosures. The named “successor” in title engaged in no transaction to acquire the debt.

Transfer of the note was without regard to transferring the debt because neither the grantor nor grantee owned the debt. If the truth comes out, the transfer of the note will be seen as a sham paper transfer and the debt will be owned by whoever has money in the loan deal. Hence transfer of the note is not transfer of the debt. By denying the transfer of the note, the burden of proof should be on the would-be foreclosing party to show it was part of a real transaction.

Filed under: foreclosure |